Property prices thread

[Tamas]

Curious. Is this the covid reshuffle continuing or something else I ponder?

Maybe just simple affordability. Most expensive properties are the farthest from what people can afford repayments on.

[Sheilbh]

Curious. Is this the covid reshuffle continuing or something else I ponder?

I think it's definitely part of it. If you look at Scotland lowest demand is in Glasgow and Edinburgh, in England lowest demand is in London.

The post-covid price boom has affected London (and a few other cities) least - I think part of that is the middle class WFH re-shuffle (and second home buying). Might also help explain why prices have gone up so quickly in the last two years if part of it is buyers from very expensive regions moving buying in cheaper ones.

[Tamas]

Curious. Is this the covid reshuffle continuing or something else I ponder?

I think it's definitely part of it. If you look at Scotland lowest demand is in Glasgow and Edinburgh, in England lowest demand is in London.

The post-covid price boom has affected London (and a few other cities) least - I think part of that is the middle class WFH re-shuffle (and second home buying). Might also help explain why prices have gone up so quickly in the last two years if part of it is buyers from very expensive regions moving buying in cheaper ones.

Yeah but surely also super-cheap credit. our area wasn't exactly unpopular or cheap pre-pandemic, but after the stamp duty holiday it just exploded - not surprisingly it's in acceptable distance of London with greens and open spaces in similar distance.

[Sheilbh]

Yeah but surely also super-cheap credit. our area wasn't exactly unpopular or cheap pre-pandemic, but after the stamp duty holiday it just exploded - not surprisingly it's in acceptable distance of London with greens and open spaces in similar distance.

Yeah but the super-cheap credit has been a thing since 2009. There was a big spike in 2021-22 and I don't think super-cheap credit, which was already a condition in 2019, is enough to explain it.

I think various covid factors are key. I think there's been a bit of a re-shuffle for those who can WFH and a very strong focus on properties with outdoor space after lockdown (true for me - in my flat hunt I've not looked at any flats without a garden or balcony). But I don't think the effect is largely to decrease demand a bit in certain cities and add new demand on top of what already existed in other areas like the South-East/commuter towns.

The stamp duty holiday helped pump demand. But also I think the huge increase on household savings over that period because of lockdown which I suspect increased the number of people with deposits and probably increased the size of deposits. We're a country that loves credit, but during covid households were saving 20-25% of their income and I think that is tied to the subsequent boom in house prices. Partly because that's just what British people do - we don't save, we buy a house as an asset which is the store of our savings and we downsize/release equity as we get older. Also given the rise of inflation in the last year that was probably the right choice because inflation isn't kind to savings/financial assets.

Too late for me but...

[Hamilcar]

I'm looking at buying a place in Switzerland. Nice, high end new development and great location in the city. The development itself is going to be in a park. The list prices are insanely high and the agent was super pushy about first come, first serve. "Act now!!!".

I just checked the website and since February, the number of available units went from 8 to 13. People are canceling their reservations.

Something is up even in Switzerland...

[Josquius]

I'm looking at buying a place in Switzerland. Nice, high end new development and great location in the city. The development itself is going to be in a park. The list prices are insanely high and the agent was super pushy about first come, first serve. "Act now!!!".

I just checked the website and since February, the number of available units went from 8 to 13. People are canceling their reservations.

Something is up even in Switzerland...

Which city ? (or canton if its a small place and want to leave it vague)

This is very strange. I hear the situation is usually one of a sellers market where they get to be choosy about just who they sell to.

Switzerland is way over due for something resembling normalcy to establish itself given the decline in the power of the banks and multinationals shifting out tonnes of jobs.

[Hamilcar]

I'm looking at buying a place in Switzerland. Nice, high end new development and great location in the city. The development itself is going to be in a park. The list prices are insanely high and the agent was super pushy about first come, first serve. "Act now!!!".

I just checked the website and since February, the number of available units went from 8 to 13. People are canceling their reservations.

Something is up even in Switzerland...

Which city ? (or canton if its a small place and want to leave it vague)

This is very strange. I hear the situation is usually one of a sellers market where they get to be choosy about just who they sell to.

Switzerland is way over due for something resembling normalcy to establish itself given the decline in the power of the banks and multinationals shifting out tonnes of jobs.

CS and UBS are firing everyone

[Tamas]

Aaand here we go: https://www.msn.com/en-gb/money/homeandproperty/the-return-of-100pc-mortgages-could-spell-disaster-for-the-housing-market/ar-AA19Jj1A?ocid=msedgntp&cvid=02560e1fde86441194cd1ad7b989dbf4&ei=6

Skipton Building Society plans to launch a new loan that would allow borrowers to bypass standard deposit requirements by using their rental payment history. Borrowers typically need to pay a deposit of at least 5pc of the purchase price when taking out a mortgage.

The challenge of helping first-time buyers is a growing battleground area in the run-up to the next general election. Labour has announced it is working with lenders to develop a state-backed mortgage guarantee scheme to help first-time buyers take out loans.

YES, the problem has been not enough money pumped into the property demand. DEFINITELY.

FFS.

[Sheilbh]

Labour have also said they'll do planning reform "to build more genuinely affordable homes for those looking to get on the housing ladder". I'd like to think that's true but it sounds suspiciously like some magic third thing that won't actually increase supply - especially given Labour's recent line that "housing isn't a market, it's a human right". Which I'll believe when I finally see Lib Dem Councillors at the Hague, until then it's very much a market.

So my suspicion is it'll be something weird and complicated that tries to sidestep supply and demand.

On Skipton that's a very good idea. People are paying well over 25% of their net income on rent which makes saving for a deposit difficult - but is also, I think, a really relevant factor in whether someone is credit-worthy that, at the minute, is not taken account of. Given that in most of the country home-owning is cheaper than renting these are people with a regular history of paying more than the cost of a mortgage being treated as risky because they don't have family money.

[Josquius]

The 3 main parties have all been keen to announce nimby empowerment policies in recent years so if labour do do something it won't be till they're in power.

Incidentally I wonder where plaid and the snp stand on nimbyness.

[Sheilbh]

There's a housing crisis in Scotland too - the Scottish government has missed their own targets by an even bigger margin than in England.

Not sure on Plaid - I think a lot of their policy offer focuses on second homes. Which isn't going to solve problems but makes sense given Plaid's base is the Irish Sea coast, Snowdonia etc. So rural, beautiful, very popular with tourists but irrelevant to Cardiff or Swansea or most of South Wales.

[Barrister]

Just for fun I looked up Edmonton housing prices.

As you can see there was a pretty steep increase from 2000 to 2008, with prices roughly tripling in that time.

But really prices have been remarkably stable ever since.  I know I bought my house in 2011 and it's worth about the same now as when I bought it.  There was a bit of an upward blip the last couple of years (almost certainly covid-related) but that's come down again.

Is it because Alberta's economy has been steady, but no big oil booms over the last dozen years?  Or because we're still pretty good at building houses (Edmonton is in the middle of the prairie and lots of available land still)?  Because I know if you look at other major cities in Canada prices have been steadily increasing this entire time.

[HVC]

What's the population growth over time would be another consideration. And empty buildings another. The expensive Canadian cities are seen as "investments"  a lot of time before being seen as homes.

[Barrister]

What's the population growth over time would be another consideration. And empty buildings another. The expensive Canadian cities are seen as "investments"  a lot of time before being seen as homes.

Population has steadily increased over that time:

https://www.macrotrends.net/cities/20373/edmonton/population

Population in 2000 - 924,000.  Population in 2023 - 1,544,000.

[HVC]

Huh interesting. I've been for work and it didn't seem large. But then again it's not like I had a lot of time to sitesee.